E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
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"Buy.com is aggressively going after the use of video to sell and explain products," says Patti Freeman Evans, senior analyst-retail, JupiterResearch. "They have invested in their own production facility and are creating a lot of content for the Buy.tv.com section of their site."
But Buy.com also focuses on the basics of web retailing, says Sucharita Mulpuru, principal analyst-retail at Forrester Research Inc.
"Buy.com has quite possibly the best product detail pages in the business--everything you could possibly want on one page--alternative views, extensive product descriptions, product reviews, video reviews, competitive pricing information, etc.," she says. "They make it easy to research a product without going to 10 different sites." Back to Top
Something for everyone
Costco.com has recently joined Internet retailing`s $1 billion club, but it is not resting on its laurels.
The Seattle-based retail giant plans to replace the front-end platform of its web site around the first of the year.
The aim is to offer its relatively affluent customer base more options, easier navigation and increased flexibility. Customer reviews will be added and possibly gift registries, says Ginnie Roeglin, senior vice president for e-commerce and publishing.
Sales for the 2007 fiscal year reached $1.22 billion, up 39% from $880 million in the prior year.
While the company does not market its site beyond its Costco Club membership of 38 million, it does try to give those members reasons to keep coming back.
The average Costco Club member is 48 years old, and more affluent (annual household income above $78,000) and better educated (74% are college graduates) than the typical consumer, according to Roeglin. The web site is designed to appeal to that demographic.
Not only does Costco.com sell higher quality items than many department store and warehouse sites, it also promotes new and limited-time offers and features a buyer`s pick selection in some departments. The site also highlights products not available in Costco stores. For instance, large merchandise such as furniture, patio sets, playground equipment and spas that might be too bulky for warehouses are sold on the web site.
Among the more than two dozen departments listed atop the site`s home page are funerals, food and wine, musical instruments, and pets, in addition to more traditional department store offerings. Mousing over each category reveals its sub-categories, making navigation easier without cluttering up the home page.
Sucharita Mulpuru, principal retail analyst with Forrester Research, says Costco.com has an inventory of products that cannot be matched by other e-commerce sites. "Where else on the web," she says, "can you buy a casket, a set of tires, a trip to Cancun, and order prints from your digital camera, all in one stop? Not even Amazon offers travel on its site." Back to Top
The web`s way more
The web is much more than just a sales channel. For multi-channel marketers, it can be a multi-tasker of the first order--if they know how to harness its full utility, as J.C. Penney does.
"Who would have thought that J.C. Penney, one of the oldest retailers, would adopt the key principle of breaking down traditional business boundaries and connecting channels, partners, suppliers and customers through the Internet?," observes Rob Garf, vice president and general manager of retail strategies at AMR Research Inc.
JCP.com is the company`s fastest-growing business and the hub of a well-executed multi-channel strategy.
"As customers increasingly leverage the Internet to do research before shopping, they have an expectation they will be able to not only purchase merchandise online, but also research merchandise, price compare and review weekly promotions before ever setting foot into a J.C. Penney store. This requires a very sophisticated, complementary relationship among our channels and tight integration with our marketing efforts," says John Irvin, president of JCP.com.
This integration produces shopping functionality such as the Know Before You Go initiative, launched in time for the holidays, which provides online merchandise visibility at local stores, the ability to shop weekly print ads online and enhanced search capabilities.
"JCP.com is the foundation that connects each point of interaction with consistent inventory, product and customer information," says Garf, who notes the web site is accessible via tens of thousands of POS systems throughout the company`s network of stores. "This strategy has propelled revenue for its online operations to more than $1 billion annually, making the brand one of the largest online retailers in the world."
The year`s initiatives also demonstrate the retailer knows its way around Web 2.0. One example is JCPToday, a downloadable widget introduced this summer that gives customers a desktop connection to the company that supports rich media and targeted content delivery. A holiday microsite, JCPgifts.com, gives shoppers an integrated online experience that lets them search for gifts by price, person and category as well as view the retailer`s Christmas commercials, create wish lists, and download wallpapers and ringtones. Back to Top
Hub of the brand
Federated Department Stores made a big bet on the Macy`s brand. After buying up many regional department store chains, the Cincinnati-based company replaced their often-cherished names with Macy`s and then changed its own name to Macy`s Inc.
And it`s invested heavily in Macys.com, seeking to make it a great place to shop and a driver of traffic to the 850 Macy`s stores. "A big part of the web site design is to be the hub of the Macy`s brand," says Kent Anderson, president of Macys.com, "to enable online and in-store shopping, to allow customers to take advantage of services, store events and products in a seamless way across Macy`s."
Among the many site improvements is an enhanced product-comparison feature that`s improved conversion by three times. Technology from Mercado Software Inc. allows customers to search by a wide range of attributes, such as the number of cups a coffeemaker makes.